MERRILL LYNCH
GLOBAL BOND
FUND
For Investment and
Retirement
FUND LOGO
Semi-Annual Report
June 30, 1995
<PAGE>
This report is not authorized for use as an offer of sale or a
solicitation of an offer to buy shares of the Fund unless
accompanied or preceded by the Fund's current prospectus. Past
performance results shown in this report should not be considered a
representation of future performance. Investment return and
principal value of shares will fluctuate so that shares, when
redeemed, may be worth more or less than their original cost.
Merrill Lynch
Global Bond Fund
For Investment
And Retirement
Box 9011
Princeton, NJ
08543-9011
Merrill Lynch Global Bond Fund for Investment and Retirement
PORTFOLIO INFORMATION
<PAGE>
Type of Issues*
As of June 30, 1995
A bar chart illustrating the following percentages:
Financial Services 10.16%
US Government and Agency Obligations 26.83%
Commercial Paper 14.39%
Sovereign Government Obligations 45.56%
Geographical Diversification*
As of June 30, 1995
A pie chart illustrating the following percentages:
New Zealand 2.05%
Japan 7.89%
Spain 4.88%
Denmark 9.23%
United Kingdom 9.64%
United States 43.10%
Italy 1.84%
Germany 15.07%
France 4.24%
Maturity of Investments*
As of June 30, 1995
A bar chart depicting the following percentages:
5 yrs--10 yrs 49%
10 years + 13%
0-6 months 20%
6 months--5 yrs 18%
[FN]
*Percent of net assets may not equal 100%.
<PAGE>
DEAR SHAREHOLDER
During the three-month period ended June 30, 1995, global bond
markets continued the rallies which began in late 1994 and early
1995. Economic activity continued to show signs of weakness,
especially in North America, Japan and Australia. Not surprisingly,
these markets showed the largest interest rate declines during the
June quarter. The main sources of economic weakness in the United
States were the low demand in the auto and housing sectors, plus the
sharp reversal in the trade balance with Mexico following its severe
collapse on the back of policies implemented shortly after the peso
devaluation. While Canadian interest rates largely followed US
interest rates, yields in Australia benefited from a credible
domestic budget forecast that predicted a surplus in the fiscal year
ending June 1996. In Japan, it appears the economic expansion has
ground to a halt, which along with a 10% decline in the equity
market, allowed the Japanese bond market to show the best
performance among world bond markets. In Europe, growth has shifted
downward, mainly in the stronger currency countries, while the
peripheral European economies of Italy, Spain and Sweden continue to
show solid to robust growth. Despite surging inflation, very
positive developments in the late-April regional elections allowed
Italy to turn in the second-best bond market performance. Bond
markets in Spain and Sweden followed Italy's lead, but lagged.
The world's central banks remain biased to support growth, as seen
by reductions in key Japanese interest rates both in April and July,
and the US Federal Reserve Board's interest rate cut on July 6,
1995. Although the German Bundesbank has not nudged interest rates
lower since its March 30 cut, the stronger-currency countries in
Europe were able to lower interest rates. Meanwhile, the peripheral
European countries had to raise interest rates to combat rising
inflation. Global inflationary pressures have been reduced--but not
eliminated--by the recent slowing in global growth.
As mentioned in our last shareholders' report, US monetary policy
has been the main reason for the US dollar's decline to new record
lows in the spring. First, the surprising devaluation of the Mexican
peso, along with the movement by the Federal Reserve Board to a
neutral monetary policy, forced investors to reprice the dollar to
reflect this new information, especially when set against an
expected Bundesbank's interest rate increase. Since reaching new
record lows versus the Deutschemark and yen, the US dollar has
stabilized, showing a rise of just over 1% relative to the
Deutschemark while falling just under 2% relative to the yen. The
Italian lire recorded the best gain, reversing its sharp decline as
political risk was greatly reduced, while the British pound declined
over 2% following Prime Minister John Major's resignation as leader
of the Tory party, and therefore a potentially new head of
government. However, Major won the July 4 party vote and remains
Prime Minister. The Australian dollar recorded the largest decline
of 3.3% as the current account deficit widened to record levels.
<PAGE>
Investment Strategy & Outlook
Of the three major bond blocs the Fund invests across (Dollar,
Europe and Japan), we changed the mix of these blocs from 55%, 45%
and 0% to 46%, 46% and 8%, respectively, during the three months
ended June 30, 1995. Within the Dollar bloc countries (the United
States, Canada, Australia, New Zealand and Mexico), we sold the
Australian position, moving half into the United States and the
other half to a new position in New Zealand, while net reducing the
US component. The Australian market had a good run in local currency
terms, but with no letup on the poor current account data,
increasing odds of heightened political risk and possible negative
effects on inflation from the decline in the Australian dollar, we
chose to move our investments elsewhere. In Europe, the Fund's
exposure to weak currency countries, such as Italy and Spain, was
cut in half, taking advantage of the rally since late April. We also
reduced the French position before the May presidential election. In
addition, we trimmed exposure in the United Kingdom. Finally, we
initiated a new position in Japan, since weakness in the equity
market may foster increased allocation toward bonds. We used market
weakness to continue lengthening the average maturity of the
portfolio, which at June 30, 1995 stood 25% higher than at the end
of the March quarter. We further reduced the Fund's exposure to US
dollars, although the dollar has not set new lows.
Industrial world activity slowed sharply from the heady pace seen at
the end of 1994. In fact, in the United States, central bankers
mentioned recession as a probability. Current analysis of output and
demand indicators suggest the current US economic slowdown is
largely an inventory correction, with a fall off in spending
indicators suggesting something more severe. While US policymakers
lean toward the current slowdown as being an inventory correction,
the potential for a flow through to other sectors leads us to
continue to buy weakness in bond prices, until indicators show
otherwise. Although bond prices are somewhat high and the likelihood
of economic reacceleration is still some months away, significant
price declines are unlikely, in our view. Our main concern is the
pickup in inflation during the last three months, which could be
aggravated upon resumption of world growth. In addition, the
extremely positive sentiment prevailing with regard to both economic
activity and Federal Reserve Board policy expectations suggest the
majority of the positives were already discounted in bond prices.
<PAGE>
The European bond markets underperformed the US market this year as
growth slowed more markedly in the United States. Further
sustainable underper-formance seems unlikely given that the US
slowdown has been going on longer. In Japan, further outperformance
cannot be ruled out, but given current low yields, it will be more
difficult. From a currency standpoint, the probability of new lows
in the dollar has decreased sharply but cannot yet be ruled out. A
sustainably higher dollar will likely require a definitive sign of a
turnaround in the trade imbalance with Japan and/or a substantial
shift in relative monetary policy with Europe.
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
(Robert J. Parish)
Robert J. Parish
Vice President and Portfolio Manager
August 2, 1995
PERFORMANCE DATA
About Fund Performance
Since October 21, 1994, investors have been able to purchase shares
of the Fund through the Merrill Lynch Select Pricing SM System, which
offers four pricing alternatives:
* Class A Shares incur a maximum initial sales charge (front-end
load) of 4% and bear no ongoing distribution or account maintenance
fees. Class A Shares are available only to eligible investors.
* Class B Shares are subject to a maximum contingent deferred sales
charge of 4% if redeemed during the first year, decreasing 1% each
year thereafter to 0% after the fourth year. In addition, Class B
Shares are subject to a distribution fee of 0.50% and an account
maintenance fee of 0.25%. These shares automatically convert to
Class D Shares after 10 years.
<PAGE>
* Class C Shares are subject to a distribution fee of 0.55% and an
account maintenance fee of 0.25%. In addition, Class C Shares are
subject to a 1% contingent deferred sales charge if redeemed within
one year of purchase.
* Class D Shares incur a maximum initial sales charge of 4% and an
account maintenance fee of 0.25% (but no distribution fee).
Performance data for the Fund's Class A and Class B Shares are
presented in the "Average Annual Total Return" tables on page 4.
"Aggregate Total Return" tables for Class C and Class D Shares are
also presented on page 4. Data for all of the Fund's shares are
presented in the "Recent Performance Results" table on page 4.
The "Recent Performance Results" table shows investment results
before the deduction of any sales charges for Class A and Class B
Shares for the 12-month and 3-month periods ended June 30, 1995 and
for Class C and Class D Shares for the since inception and 3-month
periods ended June 30, 1995. All data in this table assume
imposition of the actual total expenses incurred by each class of
shares during the relevant period.
None of the past results shown should be considered a representation
of future performance. Investment return and principal value of
shares will fluctuate so that shares, when redeemed, may be worth
more or less than their original cost. Dividends paid to each class
of shares will vary because of the different levels of account
maintenance, distribution and transfer agency fees applicable to
each class, which are deducted from the income available to be paid
to shareholders.
PERFORMANCE DATA (concluded)
<TABLE>
Recent Performance Results
<CAPTION>
12 Month 3 Month
6/30/95 3/31/95 6/30/94++ % Change++ % Change
<S> <C> <C> <C> <C> <C>
Class A Shares* $9.42 $9.27 $9.16 +2.84% +1.62%
Class B Shares* 9.42 9.27 9.16 +2.84 +1.62
Class C Shares* 9.42 9.27 9.21 +2.28 +1.62
Class D Shares* 9.42 9.27 9.21 +2.28 +1.62
Class A Shares--Total Return* +9.49(1) +3.19(2)
Class B Shares--Total Return* +8.53(3) +2.99(4)
Class C Shares--Total Return* +6.13(5) +2.97(6)
Class D Shares--Total Return* +6.66(7) +3.12(8)
Class A Shares--Standardized 30-day Yield 5.85%
Class B Shares--Standardized 30-day Yield 5.34%
Class C Shares--Standardized 30-day Yield 5.23%
Class D Shares--Standardized 30-day Yield 5.57%
<PAGE>
<FN>
*Investment results shown do not reflect sales charges; results
shown would be lower if a sales charge was included.
++Investment results shown for Class C and Class D Shares are since
inception (10/21/94).
(1)Percent change includes reinvestment of $0.577 per share ordinary
income dividends.
(2)Percent change includes reinvestment of $0.144 per share ordinary
income dividends.
(3)Percent change includes reinvestment of $0.505 per share ordinary
income dividends.
(4)Percent change includes reinvestment of $0.126 per share ordinary
income dividends.
(5)Percent change includes reinvestment of $0.330 per share ordinary
income dividends.
(6)Percent change includes reinvestment of $0.124 per share ordinary
income dividends.
(7)Percent change includes reinvestment of $0.366 per share ordinary
income dividends.
(8)Percent change includes reinvestment of $0.138 per share ordinary
income dividends.
</TABLE>
Average Annual Total Return
% Return Without % Return With
Sales Charge Sales Charge**
Class A Shares*
Year Ended 6/30/95 + 9.49% +5.11%
Five Years Ended 6/30/95 +10.08 +9.18
Inception (10/25/88)
through 6/30/95 + 9.68 +9.01
[FN]
*Maximum sales charge is 4%.
**Assuming maximum sales charge.
<PAGE>
% Return % Return
Without CDSC With CDSC**
Class B Shares*
Year Ended 6/30/95 +8.53% +4.53%
Five Years Ended 6/30/95 +9.22 +9.22
Inception (8/29/86) through 6/30/95 +9.74 +9.74
[FN]
*Maximum contingent deferred sales charge is 4% and is reduced to 0%
after 4 years.
**Assuming payment of applicable contingent deferred sales charge.
Aggregate Total Return
% Return % Return
Without CDSC With CDSC**
Class C Shares*
Inception (10/21/94)
through 6/30/95 +6.13% +5.13%
[FN]
*Maximum contingent deferred sales charge is 1% and is reduced to 0%
after 1 year.
**Assuming payment of applicable contingent deferred sales charge.
% Return Without % Return With
Sales Charge Sales Charge**
Class D Shares*
Inception (10/21/94)
through 6/30/95 +6.66% +2.40%
[FN]
*Maximum sales charge is 4%.
**Assuming maximum sales charge.
<PAGE>
<TABLE>
SCHEDULE OF INVESTMENTS
<CAPTION>
Face Interest Maturity Value Percent of
Amount Long-Term Obligations Rate Date (Note 1a) Net Assets
<S> <S> <C> <S> <C> <C> <C> <C>
Denmark
Sovereign Dkr 271,000,000 Denmark Government Bond 9.00% 11/15/2000 $ 52,000,667 6.57%
Government 76,000,000 Denmark Government Bond 8.00 11/15/2001 13,870,669 1.75
Obligations 40,000,000 Denmark Government Bond 8.00 5/15/2003 7,197,332 0.91
Total Investments in Denmark
(Cost--$68,959,505) 73,068,668 9.23
France
Sovereign Frf 80,000,000 French Government BTAN 7.25 8/12/1997 16,685,101 2.11
Government 80,000,000 French Government BTAN 7.75 4/12/2000 16,902,719 2.13
Obligations
Total Investments in France
(Cost--$33,336,974) 33,587,820 4.24
Germany
Financial DM 32,000,000 Baden-Wurt L-Finance N.V. 6.75 6/22/2005 22,372,234 2.82
Services 37,000,000 European Investment Banking Trust 7.75 1/26/2005 27,863,702 3.52
Sovereign 11,000,000 Deutschland Republic 6.25 1/04/2024 6,735,213 0.85
Government 84,000,000 Treuhandanstalt 7.50 9/09/2004 62,371,366 7.88
Obligations
Total Investments in Germany
(Cost--$118,280,995) 119,342,515 15.07
Italy
Sovereign Lit 27,000,000,000 Buoni Poliennali del Tesoro (Italian
Government Government Bonds) 8.50 8/01/1999 14,584,291 1.84
Obligations
Total Investments in Italy
(Cost--$14,648,009) 14,584,291 1.84
Japan
<PAGE>
Financial YEN 1,160,000,000 World Bank 4.50 3/20/2003 15,378,114 1.94
Services
Sovereign 1,200,000,000 Japanese Government Bond 5.00 9/20/2002 16,256,876 2.05
Government 2,400,000,000 Japanese Government Bond 4.00 6/20/2005 30,852,650 3.90
Obligations
Total Investments in Japan
(Cost--$61,448,347) 62,487,640 7.89
New Zealand
Sovereign NZ$ 23,500,000 New Zealand Government Bond 10.00 7/15/1997 16,220,513 2.05
Government
Obligations
Total Investments in New Zealand
(Cost--$16,337,586) 16,220,513 2.05
</TABLE>
<TABLE>
SCHEDULE OF INVESTMENTS (continued)
<CAPTION>
Face Interest Maturity Value Percent of
Amount Issue Rate Date (Note 1a) Net Assets
<S> <S> <C> <S> <C> <C> <C> <C>
Spain
Sovereign Pta 5,400,000,000 Government of Spain 7.40% 7/30/1999 $ 38,649,113 4.88%
Government
Obligations
Total Investments in Spain
(Cost--$35,970,609) 38,649,113 4.88
United Kingdom
<PAGE>
Sovereign Pound 21,000,000 United Kingdom Gilt 7.25 3/30/1998 32,878,617 4.15
Government Sterling 6,300,000 United Kingdom Gilt 7.00 11/06/2001 9,356,315 1.18
Obligations 14,600,000 United Kingdom Gilt 9.75 8/27/2002 24,832,278 3.13
5,700,000 United Kingdom Gilt 8.75 8/25/2017 9,315,161 1.18
Total Investments in the United Kingdom
(Cost--$76,547,170) 76,382,371 9.64
United States
Financial US$ 14,500,000 Rodamco 7.30 5/15/2005 14,862,500 1.88
Services
US Government 45,500,000 Federal National Mortgage Association 8.55 12/10/2004 47,618,480 6.01
& Agency 93,000,000 United States Treasury Notes 7.875 11/15/2004 103,578,750 13.08
Obligations 15,000,000 United States Treasury Notes 6.50 5/15/2005 15,318,750 1.93
Total Investments in the United States
(Cost--$173,322,744) 181,378,480 22.90
Total Investments in Long-Term
Obligations (Cost--$598,851,939) 615,701,411 77.74
Short-Term Obligations
United States
Commercial 20,000,000 Ciesco, L.P. 5.92 7/27/1995 19,921,067 2.52
Paper* 20,000,000 Dean Witter, Discover & Co. 5.95 7/05/1995 19,993,389 2.52
25,067,000 General Electric Capital Corp. 6.20 7/03/1995 25,067,000 3.17
24,000,000 Penney (J.C.) Co. 5.95 7/27/1995 23,904,800 3.02
25,000,000 Sheffield Receivables Corp. 6.05 7/05/1995 24,991,597 3.16
Total Investments in Commercial Paper
(Cost--$113,877,853) 113,877,853 14.39
US Government 25,000,000 Federal Home Loan Mortgage Corp. 5.90 7/17/1995 24,942,639 3.15
& Agency 5,000,000 Federal National Mortgage Association 5.88 7/19/1995 4,986,933 0.63
Obligations 14,500,000 Student Loan Marketing Association 5.66 11/09/1995 14,500,000 1.83
100,000 United States Treasury Bills (a) 5.76 9/07/1995 98,989 0.01
1,550,000 United States Treasury Bills (a) 5.78 9/07/1995 1,534,336 0.19
<PAGE>
Total Investments in US Government
& Agency Obligations (Cost--$46,062,635) 46,062,897 5.81
Total Investments in Short-Term
Obligations (Cost--$159,940,488) 159,940,750 20.20
</TABLE>
<TABLE>
SCHEDULE OF INVESTMENTS (continued)
<CAPTION>
Par Strike Expiration Value Percent of
Value Issue Price Date (Note 1a) Net Assets
<S> <S> <C> <S> <C> <C> <C> <C>
Currency Call Options Purchased
DM 8,752,735 German Mark $ 1.371 7/31/1995 $ 44,639 0.01%
28,996,013 German Mark 1.379 8/31/1995 414,643 0.05
Total Currency Call Options
Purchased (Cost--$318,625) 459,282 0.06
Currency Put Options Purchased
DM 13,986,014 German Mark 1.430 6/30/1995 8,391 0.00
28,000,000 German Mark 1.432 7/31/1995 5,600 0.00
16,000,000 German Mark 1.434 7/31/1995 1,600 0.00
27,656,779 German Mark 1.446 7/31/1995 19,360 0.00
YEN 16,000,000 Japanese Yen 86.250 7/31/1995 36,800 0.01
NZ$ 16,771,553 New Zealand Dollar 0.659 8/31/1995 109,015 0.01
Total Currency Put Options
Purchased (Cost--$975,514) 180,766 0.02
Total Options Purchased (Cost--
$1,294,140) 640,048 0.08
Total Investments (Cost--$760,086,567) 776,282,209 98.02
Currency Call Options Written
<PAGE>
DM 14,575,135 German Mark 1.372 6/30/1995 (84,536) (0.01)
29,750,837 German Mark 1.344 7/31/1995 (98,178) (0.01)
28,000,000 German Mark 1.383 7/31/1995 (187,600) (0.02)
16,385,401 German Mark 1.370 8/31/1995 (213,010) (0.03)
YEN 16,000,000 Japenese Yen 82.720 7/31/1995 (22,400) (0.00)
NZ$ 17,254,736 New Zealand Dollar 1.370 8/31/1995 (60,391) (0.01)
US$ 20,000,000 United States Treasury Stock 109.000 7/31/1995 (425,000) (0.05)
Total Currency Call Options
Written (Premiums Received--$928,017) (1,091,115) (0.13)
</TABLE>
<TABLE>
SCHEDULE OF INVESTMENTS (concluded)
<CAPTION>
Par Strike Expiration Value Percent of
Value Issue Price Date (Note 1a) Net Assets
<S> <S> <C> <S> <C> <C> <C> <C>
Currency Put Options Written
DM 28,000,000 German Mark $1.480 7/31/1995 $ 0 0.00%
26,809,651 German Mark 1.490 7/31/1995 (4,021) 0.00
Total Currency Put Options Written
(Premiums Received--$116,172) (4,021) 0.00
Total Options Written (Premiums
Received--$1,044,189) (1,095,136) (0.13)
Total Investments, Net of Options Written (Cost--$759,042,378) 775,187,073 97.89
Unrealized Depreciation on Forward Foreign Exchange Contracts** (1,177,436) (0.15)
Variation Margin on Future Contracts*** 5,619 0.00
Other Assets Less Liabilities 17,852,183 2.26
------------ -------
Net Assets $791,867,439 100.00%
============ =======
<FN>
*Commercial Paper and certain US Government & Agency Obligations are
traded on a discount basis; the interest rates shown are the
discount rates paid at the time of purchase by the Fund.
**Forward foreign exchange contracts as of June 30, 1995 are as
follows:
<PAGE>
Unrealized
Expiration Appreciation
Foreign Currency Purchased Date (Depreciation)
DM 213,254,787 July 1995 $ 2,107,423
YEN 7,242,787,937 July 1995 (482,517)
Total (US$ Commitment--$238,168,811) 1,624,906
-----------
Foreign Currency Sold
DM 192,968,200 July 1995 (2,549,893)
Pta 3,466,443,700 July 1995 (55,952)
Frf 24,404,109 July 1995 (89,424)
L 8,537,407 July 1995 148,414
Lit 17,819,412,100 July 1995 (45,074)
YEN 2,049,480,000 July 1995 (210,413)
Total (US$ Commitment--$219,020,323) (2,802,342)
-----------
Total Unrealized Depreciation on Forward
Foreign Exchange Contracts--Net $(1,177,436)
===========
***Financial futures contracts purchased as of June 30, 1995 are as
follows:
Number of Expiration Value
Contracts Issue Exchange Date (Note 1a)
48 UK Gilt LIFFE September 1995 $3,937,680
(Total Contract Price--$4,069,393) $3,937,680
==========
(a)Security held in connection with financial futures contracts.
See Notes to Financial Statements.
</TABLE>
<PAGE>
FINANCIAL INFORMATION
<TABLE>
Statement of Assets and Liabilities as of June 30, 1995
<S> <S> <C> <C>
Assets: Investments, at value (identified cost--$758,792,427) (Note 1a) $ 775,642,161
Put options purchased, at value (cost--$1,294,140)(Notes 1a & 1b) 640,048
Foreign cash (Note 1c) 1,703,994
Receivables:
Securities sold $ 35,750,303
Interest 18,219,671
Beneficial interest sold 768,052
Variation margin (Note 1b) 5,619 54,743,645
------------
Prepaid registration fees and other assets (Note 1f) 42,903
--------------
Total assets 832,772,751
--------------
Liabilities: Unrealized depreciation on forward foreign exchange contracts
(Note 1b) 1,177,436
Call options written, at value (premiums received--$1,044,189)
(Notes 1a & 1b) 1,095,136
Payables:
Securities purchased 34,384,016
Beneficial interest redeemed 1,789,688
Dividends to shareholders (Note 1g) 1,176,208
Distributor (Note 2) 449,556
Investment adviser (Note 2) 418,554 38,218,022
------------
Accrued expenses and other liabilities 414,718
--------------
Total liabilities 40,905,312
--------------
Net Assets: Net assets $ 791,867,439
==============
Net Assets Class A Shares of beneficial interest, $0.10 par value,
Consist of: unlimited number of shares authorized $ 1,188,015
Class B Shares of beneficial interest, $0.10 par value,
unlimited number of shares authorized 7,059,242
Class C Shares of beneficial interest, $0.10 par value,
unlimited number of shares authorized 111,387
Class D Shares of beneficial interest, $0.10 par value,
unlimited number of shares authorized 47,581
Paid-in capital in excess of par 835,789,126
Accumulated realized capital losses on investments and
foreign currency transactions--net (Note 6) (67,467,556)
Unrealized appreciation on investments and foreign currency
transactions--net 15,139,644
--------------
Net assets $ 791,867,439
==============
<PAGE>
Net Asset Class A--Based on net assets of $111,889,437 and 11,880,153
Value: shares of beneficial interest outstanding $ 9.42
==============
Class B--Based on net assets of $665,003,827 and 70,592,421
shares of beneficial interest outstanding $ 9.42
==============
Class C--Based on net assets of $10,491,694 and 1,113,867
shares of beneficial interest outstanding $ 9.42
==============
Class D--Based on net assets of $4,482,481 and 475,806
shares of beneficial interest outstanding $ 9.42
==============
See Notes to Financial Statements.
</TABLE>
FINANCIAL INFORMATION (continued)
<TABLE>
Statement of Operations for the Six Months Ended June 30, 1995
<S> <S> <C> <C>
Investment Interest and discount earned (net of $168,756 foreign
Income withholding tax) $ 28,201,121
(Notes 1d & 1e):
Expenses: Account maintenance and distribution fees--Class B (Note 2) $ 2,537,895
Investment advisory fees (Note 2) 2,336,108
Transfer agent fees--Class B (Note 2) 526,834
Custodian fees 160,659
Printing and shareholder reports 130,154
Accounting services (Note 2) 102,474
Transfer agent fees--Class A (Note 2) 59,587
Professional fees 57,847
Registration fees (Note 1f) 52,649
Account maintenance and distribution fees--Class C (Note 2) 28,798
Trustees' fees and expenses 19,659
Transfer agent fees--Class C (Note 2) 6,341
Account maintenance fees--Class D (Note 2) 3,802
Transfer agent fees--Class D (Note 2) 1,971
Other 11,637
------------
Total expenses 6,036,415
------------
Investment income--net 22,164,706
------------
<PAGE>
Realized & Realized gain from:
Unrealized Gain on Investments--net 2,286,331
Investments & Foreign currency transactions--net 905,049 3,191,380
Foreign Currency ------------
Transactions-- Change in unrealized appreciation/depreciation on:
Net (Notes Investments--net 31,253,609
1b, 1c, 1e & 3): Foreign currency transactions--net 4,574,476 35,828,085
------------ ------------
Net realized and unrealized gain on investments and foreign
currency transactions 39,019,465
------------
Net Increase in Net Assets Resulting from Operations $ 61,184,171
============
See Notes to Financial Statements.
</TABLE>
FINANCIAL INFORMATION (continued)
<TABLE>
Statements of Changes in Net Assets
<CAPTION>
For the For the
Six Months Year Ended
Ended December 31,
Increase (Decrease) in Net Assets: June 30,1995 1994
<S> <S> <C> <C>
Operations: Investment income--net $ 22,164,706 $ 46,679,221
Realized gain (loss) on investments and foreign currency
transactions--net 3,191,380 (88,234,663)
Change in unrealized appreciation/depreciation on investments
and foreign currency transactions--net 35,828,085 (16,633,511)
------------ --------------
Net increase (decrease) in net assets resulting from
operations 61,184,171 (58,188,953)
------------ --------------
<PAGE>
Dividends & Investment income--net:
Distributions to Class A (2,915,118) (2,646,477)
Shareholders Class B (18,960,366) (17,852,973)
(Note lf): Class C (196,797) (7,735)
Class D (92,425) (4,087)
Return of capital--net:
Class A -- (3,059,329)
Class B -- (20,638,053)
Class C -- (8,942)
Class D -- (4,725)
In excess of realized gain on investments--net:
Class A -- (317,003)
Class B -- (2,138,481)
Class C -- (926)
Class D -- (490)
------------ --------------
Net decrease in net assets resulting from dividends and
distributions to shareholders (22,164,706) (46,679,221)
------------ --------------
Beneficial Net decrease in net assets derived from beneficial interest
Interest transactions (44,339,446) (103,334,766)
Transactions ------------ --------------
(Note 4):
Net Assets: Total decrease in net assets (5,319,981) (208,202,940)
Beginning of period 797,187,420 1,005,390,360
------------ --------------
End of period $791,867,439 $ 797,187,420
============ ==============
See Notes to Financial Statements.
</TABLE>
FINANCIAL INFORMATION (continued)
<PAGE>
<TABLE>
Financial Highlights
<CAPTION>
Class A
For the
The following per share data and ratios have been derived Six Months
from information provided in the financial statements. Ended For the Year Ended December 31,
June 30,
Increase (Decrease) in Net Asset Value: 1995 1994 1993 1992 1991
<S> <S> <C> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $ 8.96 $ 10.03 $ 9.79 $ 10.38 $ 9.93
Operating -------- -------- -------- -------- --------
Performance: Investment income--net. . .29 .55 .70 .77 .95
Realized and unrealized gain (loss) on
investments and foreign currency
transactions--net .46 (1.07) .56 .01 .55
-------- -------- -------- -------- --------
Total from investment operations . .75 (.52) 1.26 .78 1.50
-------- -------- -------- -------- --------
Less dividends and distributions:
Investment income--net (.29) (.24) (.67) (1.14) (1.05)
Realized gain on investments--net -- -- (.30) (.23) --
Return of capital--net -- (.28) -- -- --
In excess of realized gain on
investments--net -- (.03) (.05) -- --
-------- -------- -------- -------- --------
Total dividends and distributions (.29) (.55) (1.02) (1.37) (1.05)
-------- -------- -------- -------- --------
Net asset value, end of period $ 9.42 $ 8.96 $ 10.03 $ 9.79 $ 10.38
======== ======== ======== ======== ========
Total Investment Based on net asset value per share 8.54%+++ (5.29%) 13.21% 7.83% 16.00%
Return:** ======== ======== ======== ======== ========
Ratios to Expenses .87%* .84% .82% .84% .99%
Average Net ======== ======== ======== ======== ========
Assets: Investment income--net 6.36%* 5.84% 6.44% 12.24% 8.02%
======== ======== ======== ======== ========
<PAGE>
Supplemental Net assets, end of period (in thousands) $111,889 $ 90,823 $108,241 $ 61,131 $ 21,211
Data: ======== ======== ======== ======== ========
Portfolio turnover 230.33% 405.00% 419.99% 235.11% 67.76%
======== ======== ======== ======== ========
<FN>
*Annualized.
**Total investment returns exclude the effects of sales loads.
+++Aggregate total investment return.
See Notes to Financial Statements.
</TABLE>
FINANCIAL INFORMATION (continued)
<TABLE>
Financial Highlights (continued)
<CAPTION>
Class B
For the
The following per share data and ratios have been derived Six Months
from information provided in the financial statements. Ended For the Year Ended December 31,
June 30,
Increase (Decrease) in Net Asset Value: 1995 1994 1993 1992 1991
<S> <S> <C> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $ 8.96 $ 10.03 $ 9.79 $ 10.39 $ 9.93
Operating -------- -------- -------- -------- --------
Performance: Investment income--net. . .26 .47 .60 .70 .85
Realized and unrealized gain (loss) on
investments and foreign currency
transactions--net .46 (1.07) .58 (.01) .58
-------- -------- -------- -------- --------
Total from investment operations . .72 (.60) 1.18 .69 1.43
-------- -------- -------- -------- --------
Less dividends and distributions:
Investment income--net (.26) (.20) (.59) (1.06) (.97)
Realized gain on investments--net -- -- (.30) (.23) --
Return of capital--net -- (.24) -- -- --
In excess of realized gain on
investments--net -- (.03) (.05) -- --
-------- -------- -------- -------- --------
Total dividends and distributions (.26) (.47) (.94) (1.29) (.97)
-------- -------- -------- -------- --------
Net asset value, end of period $ 9.42 $ 8.96 $ 10.03 $ 9.79 $ 10.39
======== ======== ======== ======== ========
<PAGE>
Total Investment Based on net asset value per share 8.04%+++ (6.01%) 12.36% 6.91% 15.23%
Return:** ======== ======== ======== ======== ========
Ratios to Expenses, excluding account maintenance
Average Net and distribution fees .89%* .86% .83% .86% 1.02%
Assets: ======== ======== ======== ======== ========
Expenses 1.64%* 1.61% 1.58% 1.61% 1.77%
======== ======== ======== ======== ========
Investment income--net 5.60%* 5.06% 5.72% 11.67% 7.76%
======== ======== ======== ======== ========
Supplemental Net assets, end of period (in thousands) $665,004 $700,995 $897,150 $637,834 $380,749
Data: ======== ======== ======== ======== ========
Portfolio turnover 230.33% 405.00% 419.99% 235.11% 67.76%
======== ======== ======== ======== ========
<FN>
*Annualized.
**Total investment returns exclude the effects of sales loads.
+++Aggregate total investment return.
See Notes to Financial Statements.
</TABLE>
FINANCIAL INFORMATION (concluded)
<PAGE>
<TABLE>
Financial Highlights (concluded)
<CAPTION>
Class C Class D
For the For the For the For the
Six Period Six Period
The following per share data and ratios have been derived Months Oct. 21, Months Oct. 21,
from information provided in the financial statements. Ended 1994++ to Ended 1994++ to
June 30, Dec. 31, June 30, Dec. 31,
Increase (Decrease) in Net Asset Value: 1995 1994 1995 1994
<S> <S> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $ 8.96 $ 9.21 $ 8.96 $ 9.21
Operating -------- -------- -------- --------
Performance: Investment income--net .25 .09 .28 .10
Realized and unrealized gain (loss) on investments
and foreign currency transactions--net .46 (.25) .46 (.25)
-------- -------- -------- --------
Total from investment operations .71 (.16) .74 (.15)
-------- -------- -------- --------
Less dividends and distributions:
Investment income--net (.25) (.03) (.28) (.04)
Realized gain on investments--net -- -- -- --
Return of capital--net -- (.05) -- (.05)
In excess of realized gain on investments--net -- (.01) -- (.01)
-------- -------- -------- --------
Total dividends and distributions (.25) (.09) (.28) (.10)
-------- -------- -------- --------
Net asset value, end of period $ 9.42 $ 8.96 $ 9.42 $ 8.96
======== ======== ======== ========
Total Investment Based on net asset value per share 8.00%+++ (1.73%)+++ 8.42%+++ (1.62%)+++
Return:** ======== ======== ======== ========
Ratios to Expenses, excluding account maintenance and
Average Net distribution fees . .91%* .89%* .87%* .87%*
Assets: ======== ======== ======== ========
Expenses 1.71%* 1.69%* 1.12%* 1.12%*
======== ======== ======== ========
Investment income--net 5.47%* 5.20%* 6.08%* 5.81%*
======== ======== ======== ========
<PAGE>
Supplemental Net assets, end of period (in thousands) $ 10,492 $ 3,614 $ 4,482 $ 1,755
Data: ======== ======== ======== ========
Portfolio turnover 230.33% 405.00% 230.33% 405.00%
======== ======== ======== ========
<FN>
*Annualized.
**Total investment returns exclude the effects of sales loads.
+++Aggregate total investment return.
++Commencement of Operations.
See Notes to Financial Statements.
</TABLE>
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
Merrill Lynch Global Bond Fund for Investment and Retirement (the
"Fund") is registered under the Investment Company Act of 1940 as a
non-diversified, open-end management investment company. These
unaudited financial statements reflect all adjustments which are, in
the opinion of management, necessary to a fair statement of the
results for the interim period presented. All such adjustments are
of a normal recurring nature. The Fund offers four classes of shares
under the Merrill Lynch Select Pricing SM System. Shares of Class A
and Class D are sold with a front-end sales charge. Shares of Class
B and Class C may be subject to a contingent deferred sales charge.
All classes of shares have identical voting, dividend, liquidation
and other rights and the same terms and conditions, except that
Class B, Class C and Class D Shares bear certain expenses related to
the account maintenance of such shares, and Class B and Class C
Shares also bear certain expenses related to the distribution of
such shares. Each class has exclusive voting rights with respect to
matters relating to its account maintenance and distribution
expenditures. The following is a summary of significant accounting
policies followed by the Fund.
<PAGE>
(a) Valuation of securities--Securities traded in the over-the-
counter market are valued at the last available bid price prior to
the time of valuation. Portfolio securities which are traded on
stock exchanges are valued at the last sale price on the exchange on
which such securities are traded, as of the close of business on the
day the securities are being valued or, lacking any sales, at the
last available bid price. In cases where securities are traded on
more than one exchange, the securities are valued on the exchange
designated by or under the authority of the Board of Trustees as the
primary market. Options written are valued at the last sale price in
the case of exchange-traded options or, in the case of options
traded in the over-the-counter market, the last asked price. Options
purchased are valued at the last sale price in the case of exchange-
traded or, in the case of options traded in the over-the-counter
market, the last bid price. Other investments, including futures
contracts and related options, are stated at market value or
otherwise at the fair value at which it is expected they may be
resold, as determined in good faith by or under the direction of the
Board of Trustees. Securities and assets for which market quotations
are not readily available are valued at fair value as determined in
good faith by or under the direction of the Fund's Board of
Trustees.
(b) Derivative financial investments--The Fund may engage in various
portfolio strategies to seek to increase its return by hedging its
portfolio against adverse movements in the equity, debt and currency
markets. Losses may arise due to changes in the value of the
contract or if the counterpart does not perform under the contract.
* Forward foreign exchange contracts--The Fund is authorized to
enter into forward foreign exchange contracts as a hedge against
either specific transactions or portfolio positions. Such contracts
are not entered on the Fund's records. However, the effect on
operations is recorded from the date the Fund enters into such
contracts. Premium or discount is amortized over the life of the
contracts.
* Foreign currency options and futures--The Fund may also purchase
or sell listed or over-the-counter foreign currency options, foreign
currency futures and related options on foreign currency futures as
a short or long hedge against possible variations in foreign
exchange rates. Such transactions may be effected with respect to
hedges on non-US dollar denominated securities owned by the Fund,
sold by the Fund but not yet delivered, or committed or anticipated
to be purchased by the Fund.
<PAGE>
* Financial futures contracts--The Fund may purchase or sell
financial futures contracts and options on such futures contracts as
a hedge against adverse changes in interest rates. A futures
contract is an agreement between two parties to buy and sell a
security, respectively, for a set price on a future date. Upon
entering into a contract, the Fund deposits and maintains as
collateral such initial margin as required by the exchange on which
the transaction is effected. Pursuant to the contract, the Fund
agrees to receive from or pay to the broker an amount of cash equal
to the daily fluctuation in value of the contract. Such receipts or
payments are known as variation margin and are recorded by the Fund
as unrealized gains or losses. When the contract is closed, the Fund
records a realized gain or loss equal to the difference between the
value of the contract at the time it was opened and the value at the
time it was closed.
NOTES TO FINANCIAL STATEMENTS (continued)
* Options--The Fund is authorized to write covered call options and
purchase put options. When the Fund writes an option, an amount
equal to the premium received by the Fund is reflected as an asset
and an equivalent liability. The amount of the liability is
subsequently marked to market to reflect the current market value of
the option written.
When a security is purchased or sold through an exercise of an
option, the related premium paid (or received) is added to (or
deducted from) the basis of the security acquired or deducted from
(or added to) the proceeds of the security sold. When an option
expires (or the Fund enters into a closing transaction), the Fund
realizes a gain or loss on the option to the extent of the premiums
received or paid (or gain or loss to the extent the cost of the
closing transaction exceeds the premium paid or received).
Written and purchased options are non-income producing investments.
(c) Foreign currency transactions--Transactions denominated in
foreign currencies are recorded at the exchange rate prevailing when
recognized. Assets and liabilities denominated in foreign currencies
are valued at the exchange rate at the end of the period. Foreign
currency transactions are the result of settling (realized) or
valuing (unrealized) assets or liabilities expressed in foreign
currencies into US dollars. Realized and unrealized gains or losses
from investments include the effects of foreign exchange rates on
investments.
(d) Income taxes--It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute all of its taxable income to
its shareholders. Therefore, no Federal income tax provision is
required. Under the applicable foreign tax law, a withholding tax
may be imposed on interest, dividends, and capital gains at various
rates.
<PAGE>
(e) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are entered
into (the trade dates). Interest income (including amortization of
discount) is recognized on the accrual basis. Realized gains and
losses on security transactions are determined on the identified
cost basis.
(f) Prepaid registration fees--Prepaid registration fees are charged
to expense as the related shares are issued.
(g) Dividends and distributions--Dividends from net investment
income are declared daily and paid monthly. Distributions of capital
gains are recorded on the ex-dividend dates.
2. Investment Advisory Agreement and
Transactions with Affiliates:
The Fund has entered into an Investment Advisory Agreement with
Merrill Lynch Asset Management, L.P. ("MLAM"). The general partner
of MLAM is Princeton Services, Inc. ("PSI"), an indirect wholly-
owned subsidiary of Merrill Lynch & Co., Inc. ("ML & Co."), which is
the limited partner. The Fund has also entered into a Distribution
Agreement and Distribution Plans with Merrill Lynch Funds
Distributor, Inc. ("MLFD" or "Distributor"), a wholly-owned
subsidiary of Merrill Lynch Group, Inc.
MLAM is responsible for the management of the Fund's portfolio and
provides the necessary personnel, facilities, equipment and certain
other services necessary to the operations of the Fund. For such
services, the Fund pays a monthly fee of 0.60%, on an annual basis,
of the average daily value of the Fund's net assets. The most
restrictive annual expense limitation requires that the Investment
Adviser reimburse the Fund to the extent the Fund's expenses
(excluding interest rates, distribution fees, brokerage fees and
commissions, and extraordinary items) exceed 2.5% of the Fund's
first $30 million of average daily net assets, 2.0% of the Fund's
next $70 million of average daily net assets, and 1.5% of the
average daily net assets in excess thereof. The Adviser's obligation
to reimburse the Fund is limited to the amount of the investment
advisory fee. No fee payment will be made to the Investment Adviser
during any fiscal year which will cause such expenses to exceed the
most restrictive expense limitation at the time of such payment.
Pursuant to the distribution plans ("the Distribution Plans")
adopted by the Fund in accordance with Rule 12b-1 under the
Investment Company Act of 1940, the Fund pays the Distributor
ongoing account maintenance and distribution fees. The fees are
accrued daily and paid monthly at annual rates based upon the
average daily net assets of the shares as follows:
<PAGE>
Account
Maintenance Distribution
Fee Fee
Class B 0.25% 0.50%
Class C 0.25% 0.55%
Class D 0.25% --
Pursuant to a sub-agreement with the Distributor, Merrill Lynch,
Pierce, Fenner & Smith Inc. ("MLPF&S"), a subsidiary of ML & Co.,
also provides account maintenance and distribution services to the
Fund. The ongoing account maintenance fee compensates the
Distributor and MLPF&S for providing account maintenance services to
Class B, Class C and Class D shareholders. The ongoing distribution
fee compensates the Distributor and MLPF&S for providing shareholder
and distribution-related services to Class B and Class C
shareholders.
For the six months ended June 30, 1995, MLFD earned underwriting
discounts and MLPF&S earned dealer concessions on sales of the
Fund's Class A and Class D Shares as follows:
MLFD MLPF&S
Class A $ 616 $ 3,428
Class D $1,044 $12,718
For the six months ended June 30, 1995, MLPF&S received contingent
deferred sales charges of $1,025,256 and $2,575 relating to
transactions in Class B and Class C Shares, respectively.
Merrill Lynch Financial Data Services, Inc. ("MLFDS"), a wholly-
owned subsidiary of ML & Co., is the Fund's transfer agent.
Accounting services are provided to the Fund by MLAM at cost.
Certain officers and/or trustees of the Fund are officers and/or
directors of MLPF&S, PSI, MLFD, MLAM, MLFDS, and/or ML & Co.
3. Investments:
Purchases and sales of investments, excluding short-term securities,
for six months ended June 30, 1995 were $1,352,089,371 and
$1,449,087,519, respectively.
Net realized and unrealized gains (losses) as of June 30, 1995 were
as follows:
<PAGE>
Realized Unrealized
Gains Gains
(Losses) (Losses)
Investments:
Long-term $ 4,716,609 $ 16,849,473
Short-term (279) 261
Financial futures (2,429,999) (131,713)
----------- -------------
Total investments $ 2,286,331 $ 16,718,021
----------- -------------
Currency Transactions:
Options purchased (2,441,584) (654,092)
Options written (36,100) (50,947)
Foreign currency
transactions 19,409,075 304,098
Forward foreign
exchange contracts (16,026,342) (1,177,436)
----------- -------------
Total currency
transactions 905,049 (1,578,377)
----------- -------------
Total $ 3,191,380 $ 15,139,644
=========== =============
Transactions in call options written for the six months ended June
30, 1995 were as follows:
Number of Premiums
Call Options Written Contracts Received
Outstanding call options
written, beginning of
period 7 $ 697,119
Options written 18 2,118,540
Options expired (7) (520,193)
Options closed (5) (572,402)
Options exercised (6) (795,047)
----------- -------------
Outstanding call options
written, end of period 7 $ 928,017
=========== =============
NOTES TO FINANCIAL STATEMENTS (concluded)
<PAGE>
Transactions in put options written for the six months ended June
30, 1995 were as follows:
Number of Premiums
Put Options Written Contracts Received
Outstanding put options
written, beginning
of period -- $ --
Options written 7 696,166
Options expired (5) (579,995)
----------- -------------
Outstanding put options
written, end of period 2 $ 116,171
=========== =============
As of June 30, 1995, net unrealized appreciation for Federal income
tax purposes aggregated $16,849,734, of which $18,239,142 related to
appreciated securities and $1,389,408 related to depreciated
securities. The aggregate cost of investments at June 30, 1995 for
Federal income tax purposes was $758,792,427.
4. Beneflcial Interest Transactions:
Net decrease in net assets derived from beneficial interest
transactions was $44,339,446 and $103,334,766 for the six months
ended June 30, 1995 and the year ended December 31, 1994,
respectively.
Transactions in shares of capital for each class were as follows:
Class A Shares for the Six Months Dollar
Ended June 30, 1995 Shares Amount
Shares sold 3,880,059 $ 36,178,347
Shares issued to share-
holders in reinvestment
of dividends 221,423 2,041,812
----------- -------------
Total issued 4,101,482 38,220,159
Shares redeemed (2,359,826) (21,564,310)
----------- -------------
Net increase 1,741,656 $ 16,655,849
=========== =============
<PAGE>
Class A Shares for the Year Ended Dollar
December 31, 1994 Shares Amount
Shares sold 4,384,679 $ 40,711,428
Shares issued to share-
holders in reinvestment
of dividends 396,034 4,528,178
----------- -------------
Total issued 4,780,713 45,239,606
Shares redeemed (5,434,215) (50,793,461)
----------- -------------
Net decrease (653,502) $ (5,553,855)
=========== =============
Class B Shares for the
Six Months Ended Dollar
June 30, 1995 Shares Amount
Shares sold 5,578,426 $ 51,315,438
Shares issued to share-
holders in reinvestment
of dividends 1,235,423 11,398,553
----------- -------------
Total issued 6,813,849 62,713,991
Automatic conversion
of shares (17,098) (158,428)
Shares redeemed (14,437,567) (132,663,976)
----------- -------------
Net decrease (7,640,816) $ (70,108,413)
=========== =============
Class B Shares for the
Year Ended Dollar
December 31, 1994 Shares Amount
Shares sold 17,716,789 $ 166,930,180
Shares issued to share-
holders in reinvestment
of dividends 2,712,869 25,310,189
----------- -------------
Total issued 20,429,658 192,240,369
Shares redeemed (31,626,761) (295,457,890)
----------- -------------
Net decrease (11,197,103) $(103,217,521)
=========== =============
<PAGE>
Class C Shares for the
Six Months Ended Dollar
June 30, 1995 Shares Amount
Shares sold 848,257 $ 7,798,368
Shares issued to share-
holders in reinvestment
of dividends 16,471 152,626
----------- -------------
Total issued 864,728 7,950,994
Shares redeemed (154,275) (1,419,908)
----------- -------------
Net increase 710,453 $ 6,531,086
=========== =============
Class C Shares for the
Period October 21, 1994++ to Dollar
December 31, 1994 Shares Amount
Shares sold 417,769 $ 3,791,175
Shares issued to share-
holders in reinvestment
of dividends 1,634 14,657
----------- -------------
Total issued 419,403 3,805,832
Shares redeemed (15,989) (145,912)
----------- -------------
Net increase 403,414 $ 3,659,920
=========== =============
[FN]
++Commencement of Operations.
Class D Shares for the
Six Months Ended Dollar
June 30, 1995 Shares Amount
Shares sold 370,402 $ 3,409,210
Automatic conversion
of shares 17,098 158,428
Shares issued to share-
holders in reinvestment
of dividends 8,052 74,596
----------- -------------
Total issued 395,552 3,642,234
Shares redeemed (115,616) (1,060,200)
----------- -------------
Net increase 279,936 $ 2,582,034
=========== =============
<PAGE>
Class D Shares for the Period Dollar
Oct. 21, 1994++ to Dec. 31, 1994 Shares Amount
Shares sold 200,576 $ 1,819,651
Shares issued to share-
holders in reinvestment
of dividends 699 6,275
----------- -------------
Total issued 201,275 1,825,926
Shares redeemed (5,405) (49,236)
----------- -------------
Net increase 195,870 $ 1,776,690
=========== =============
[FN]
++Commencement of Operations.
5. Commitments:
At June 30, 1995, the Fund entered into foreign exchange contracts
under which it had agreed to buy and sell various foreign currencies
with values of approximately $16,985,000 and $17,011,000,
respectively.
6. Capital Loss Carryforward:
At December 31, 1994, the Fund had a net capital loss carryforward
of approximately $56,717,000, all of which expires in 2002. This
amount will be available to offset like amounts of any future
taxable gains.
OFFICERS AND TRUSTEES
Arthur Zeikel, President and Trustee
Donald Cecil, Trustee
Edward H. Meyer, Trustee
Charles C. Reilly, Trustee
Richard R. West, Trustee
Edward D. Zinbarg, Trustee
Terry K. Glenn, Executive Vice President
N. John Hewitt, Senior Vice President
Donald C. Burke, Vice President
Robert J. Parish, Vice President
Gerald M. Richard, Treasurer
Mark B. Goldfus, Secretary
<PAGE>
Custodian
State Street Bank and Trust Company
225 Franklin Street
Boston, Massachusetts 02101
Transfer Agent
Merrill Lynch Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, Florida 32246-6484
(800) 637-3863
